Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. (break-even analysis) niece equipment rentals of d

(Break-even analysis) Niece Equipment Rentals of Del Valle, Texas, has recently been approached about the...

60.1K

Verified Solution

Question

Finance

image

(Break-even analysis) Niece Equipment Rentals of Del Valle, Texas, has recently been approached about the prospect of purchasing a large construction crane. The crane rents for $510 an hour but operator, fuel, insurance and miscellaneous expenses run $195 an hour when the crane is in use. The company owner estimates that it will cost $1,010 a month to store and maintain the crane and the annual depreciation expense is $46,000. a. Calculate the accounting break-even number of annual rental hours needed to produce zero operating earnings from the crane (before taxes). b. Calculate the cash break-even point. If we ignore non-cash expenses such as depreciation in the break-even calculation, how many hours must the crane be rented in order to break even on a cash basis? c. Why do we have two different break-even points? What does each one tell you? a. The accounting break-even units of production is hours. (Round to the nearest whole number.)

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

General Management
1.2K views

Question 3/ 350 words: a) Describe all stages of the product life cycle. b) Give...

Accounting
1.2K views

Use Wage Bracket Method Table For DEC 31, 2018. To determine the answer. TABLE 2—BIWEEKLY Payroll Period (a) SINGLE...

Biology
1.2K views

Images videos and audio files are measured in Obits O bytes O kilobytes

Biology
1.2K views

The process of DNA replication is biologically significant because it allows the cells of living...

Physics
1.2K views

ob 3 7 battery of 10 volt is connected to a resistance of 20 ohm...

Calculus
1.2K views

The graph below is the function f x 5 4 3 2 1 32 3...

Accounting
1.2K views

Maria was a 10% partner in M Partnership. Marias outside basis in her partnership interest...

Accounting
1.2K views

You bought 60 shares of a mutual fund one year ago for $50 per share....

Accounting
1.2K views

Getty Company expects sales for the first three months of next year to be $200,000,...

Accounting
1.2K views

On January 2, Year 4, Poplar Ltd. purchased 80% of the outstanding shares of Spruce...

Accounting
1.2K views

Del Gato Clinic's cash account shows an $12,497 debit balance and its bank statement shows...

Accounting
1.2K views

Presented here are the components in Wildhorse Co.'s income statement. Determine the missing amounts....